Pakistan to approve Textile Policy this week

The Economic Coordination Committee (ECC), is expected to approve the much anticipated five-year textile policy this week.

“The textile policy has already been approved by the prime minister, which will be presented in the ECC next week,” Aliya Hamza Malik, parliamentary secretary for commerce, quoted Arab News. “After ECC approval, the policy would be a pubic document,” she added

According to the draft policy, the government will provide consistent, long-term policies for the foreseeable future, while undertaking following measures: (i) electricity will be provided at cents 9/kWh; (ii) RLNG at $6.5/MMBtu; (iii) system gas at Rs. 786/MMBtu during the policy period; (iv) Long-Term Financing Facility (LTFF) and Export Financing Scheme (EFS) rates will not be changed; (iv) review of LTFF and refinance scheme for SMEs and indirect exporters and building cost will be included; and (v) Brand Development Fund will be launched.

The government will extend fiscal incentives of Rs 838 billion for five years. Of this, the impact of electricity at cents 9/kWh - all-inclusive is estimated to be Rs 123 billion, RLNG - Rs 111 billion, DLTL for textiles and apparel products (garments/technical textile at 4 percent and made-ups at 3 percent) - Rs 420 billion, LTFF to continue at 5 percent - Rs 75 billion and EFS to continue at 3 per cent - Rs 109 billion.

Realizing the potential of value-addition in each segment of textiles and apparel supply-chain and inherited know-how of products and markets by the private sector. The Commerce Ministry has decided to set the target of value-added and textiles at $20.865 billion, of which $ 16.294 billion will be the value-added sector and $4.571 billion for the textile sector by 2020-25.